Wall Street Journal destroys Renzi: “Italy is on the brink of bankruptcy, the government has failed”

NEW YORK – “The Italian economy malaise, drops to the GDP level of 1999, threatening the survival of small businesses in the country – the Wall Street Journal – and might even undermine the cohesion of the eurozone, currency area characterized by more and more ‘deep tensions and imbalances. ”

The main financial newspaper in the world paints today – with this analysis – the bleak picture of the Italian economy. “Economists estimate that the Italian economy has grown just 0.3 percent from the previous three months in the first quarter of the year: a lower rate than half the total eurozone, where growth is well ‘stunted” .

As you can see, the data referenced by the daily were updated today. The aforementioned figures were made public by Istat in the US last night, this morning in Italy. “The Italian economy and ‘grown around 0.8 percent in 2015, the first positive result in four years. By the end of the fourth quarter, however, the third eurozone economy seemed to have already ‘exhausted its momentum, despite very favorable exogenous factors such as the decline in oil pieces, the devaluation of the euro and the expansionary policies of the Bank European “center.

“Italy’s problems are structural in nature. In his early years in office, Prime Minister Matteo Renzi has tried to give a jolt to the country embarking on an ambitious reform program, starting from the labor market. The results of this effort have been, at least on the economic front, very limited. The horse does not drink, Lorenzo Bini Smaghi wrote in a recent editorial in Corriere della Sera. Bank loans expressed as a function of GDP is less than 10 percent to the pre-crisis levels, sales of 30 homes per cent. The industry operates at 60 percent of capacity. ”

Numbers are merciless.

“The injection of liquidity ‘monthly 80 billion euro operated by the ECB has particularly helped large companies, which have effective channels to access loans at low interest rate and leverage euro weakness for food exports. The galaxy of small businesses, often family-run, are at a critical juncture: Deflation prevents them from raising prices, and the burden of taxation and red tape, is ‘steadily increasing “.

And the conclusion of the article is merciless to Italy: “It is this heavy burden, eroding profit margins, that has gradually reduced the productivity of small and medium-sized enterprises up to a level of 10 percent to the European average. This is not something that monetary policy can change, warns Guntramm Wolff, director of the think tank Bruegel Institute. Under present conditions, numerous small Italian companies can not help but try to survive the day. Many others have already ‘thrown in the towel “.